World bank proves Fonterra's claims a sham

The World Bank has suspended funding to Fonterra’s palm kernel supplier, Wilmar International, due to environmental and humanitarian concerns.

Last week Fonterra claimed Wilmar was a reputable producer of
palm kernel expeller (PKE) which is used as a feed for New
Zealand's dairy herd.

Fonterra sustainability manager John Hutchings told Radio New
Zealand: "They [Wilmar] have been working very hard to ensure that
all of their mills and plantations are RSPO (Roundtable on
Sustainable Palm Oil) certified, and they have almost completed
that task."

"Fonterra has either not done its homework or it doesn't care
about the illegal and immoral activities of a business partner.
Fonterra can no longer claim ignorance of what Wilmar and the palm
industry is doing to supply palm based animal feed to New Zealand
and has no choice but to stop all imports immediately." said Simon
Boxer, Greenpeace New Zealand senior climate campaigner.

Greenpeace is also calling on John Key to stop the imports of
palm kernel animal feed into New Zealand and on the Indonesian
Government to implement an immediate moratorium on forest and
peatland destruction for the sake of climate stability,
biodiversity and to protect indigenous peoples' land rights.

Fonterra's half-owned subsidiary, RD1, has a joint venture with
Wilmar (1), which is the world's largest trader of palm oil's and
kernel. It has a documented reputation for rainforest destruction,
illegal burning and creating social conflicts over community lands.
(2)

But the World Bank says on the back of concerns about Wilmar, it
has decided to halt all new International Finance Corporation (IFC)
investments in palm oil and review existing investments, due to
environmental and social concerns. (3)

"Only three of Wilmar's mills had RSPO certification,
representing a minute amount of certified PKE, and the majority of
its plantations had no certification at all", said Boxer

Imports of PKE have increased from 400 tonnes to 1.1 million
tonnes per year in the last decade. The secretary general of the
RSPO, Dr Vengata Rao, quoted in a recent Sunday Star Times expose
said "certainly very little expeller cake coming into New Zealand
last year would have been RSPO certified at all".

The World Bank will suspend funding of the oil palm sector
pending the development of safeguards to ensure that lending
doesn't cause social or environmental harm, according to a letter
by World Bank President Robert Zoellick.

A recent internal audit found that IFC funding of the Wilmar
Group, a plantation developer, violated the IFC's own procedures,
allowing commercial concerns to trump environmental and social
standards. The audit's findings were championed by environmental
and indigenous rights' groups who have criticised World Bank
support for industrial oil palm development which they say has
driven large-scale destruction of rainforests in Indonesia,
boosting greenhouse gas emissions, endangering rare and charismatic
species of wildlife, including the orangutan, and displacing forest
communities.